Fast Facts: Infrastructure Investment and Jobs Act
On November 15, 2021, President Biden signed The Infrastructure Investment and Jobs Act into law. The new law—which represents the largest investment in infrastructure in our nation’s history—will significantly affect both the public and private sectors. State, local, and tribal governments should begin planning now for how they intend to access and use allocated funds, along with how they plan to report required project information to the federal government. Companies in the transportation, construction, energy, and telecommunications industries will see a major influx in funding to support large-scale projects and should begin working now to understand how to leverage these federal funds, as well as address existing challenges related to labor shortage and supply chain issues.
Bernstein Shur is actively monitoring the implementation of the new law and is prepared to help you understand and benefit from it in the months ahead.
The Detail: Transportation
Transportation infrastructure is a major component of the law, with increased funding and expanded eligibility parameters for existing programs, as well as new funds. A majority of the funding—approximately $110 billion—is set aside for roads and bridges. In addition, there is $39 billion set aside for transit and $66 billion for rail.
The law provides for 11 new competitive grants for local governments. Local governments will be able to apply directly to the USDOT for funding to improves their highways, roads, and bridges, improve rail and public transit, as well as increase safety for pedestrians. This funding will be especially useful to communities that often have to wait for states to develop a program and allocate funds to local units of government.
Major Changes to Existing Programs
The law increases funding to the Surface Transportation Block Grant. This program provides a federal allocation for state use as well as allocations to local governments, and has newly expanded eligibility to include electric vehicle infrastructure, protection from cyber threats, projects to increase tourism, wildlife collision mitigation, and resiliency improvements.
In addition, Amtrak will now be required to consult with local governments before creating new routes. This will allow for more input from the community and ensure that Amtrak is serving both the relevant region as well as its local hubs.
The Detail: Climate and Energy
Clean Energy Technology
The Detail: Broadband
There is approximately $65 billion set aside for broadband infrastructure. A majority of this funding will be allocated to states to expand broadband access. There is $1 billion set aside over the next five years for “middle mile” projects. This set aside allows local governments to apply directly to the National Telecommunications and Information Administration for grants to construct, improve, or acquire middle mile infrastructure. Projects that service underserved areas will be prioritized. For example, this funding has the potential to provide broadband to thousands of people in ME and New Hampshire who currently lack access to high-speed internet.
Other Important Elements of the Law
Reduction in Red Tape
Slow Roll Out
The law is not a typical stimulus bill which funds only “shovel-ready” projects already in the pipeline. Instead, it represents a longer-term, patient approach to encourage comprehensive investment in modernized infrastructure with long-term generational benefits. As a result, the majority of the spending is expected to take months or years to implement.
The law provides once-in-a-generation opportunity for state, local and tribal governments to make significant investments in “traditional” infrastructure projects such as roads and bridges, while also investing projects that will provide new access to renewable energy, beneficial electrification, and broadband. For the private sector, renewable energy and construction sectors, along with their associated industries, will see a massive influx of capital and projects over the next five years. These industries are already working at unprecedented levels, and the size and scope of these potential projects will require additional staff in an already tight labor market, as well as likely escalate pricing for American iron and steel, concrete, and asphalt.